How These Startups Used Airbnb’s Race Problem as a Springboard

Earlier this summer, as Airbnb fended off charges of racial discrimination among some of its hosts, Stefan Grant and Rohan Gilkes spotted an opportunity to create discrimination-free lodging sites.

Within days of each other, they separately launched Noirbnb and Noirebnb, the latter of which changed its name to “Innclusive” following a brief trademark dispute. Now, as both sites get ready to welcome their first customers, they’ll have to ensure that they can prevent the kind of discrimination that led them to start their own companies in the first place. Just as important, they’ll need to make sure the niche they’re hoping to tap in minority travel is sufficiently interested in their offerings.

They have a gargantuan challenge ahead of them, to say the least. Founded in 2008, Airbnb is far and away the dominant business in the lodging share industry. With a valuation near $30 billion, it has more than 2 million listings in more than 34 countries, and has served over 60 million guests globally.

But both startups are riding a powerful wave of anger about racial discrimination in the home-sharing market — discrimination their founders claim to have personally encountered. Gilkes, 40, says an Airbnb host in Idaho abruptly cancelled his stay in May when she learned he was black; as a test, a friend who is white successfully booked the same dates. Grant, 28, says he and his friends faced police officers who were called to the house they had rented in Atlanta when neighbors saw it was occupied by African Americans.

A Harvard Business Review study in January 2016 first brought attention to the plight of black Americans on Airbnb, describing how such guests were 16% less likely to be accepted for bookings. Soon after, reported incidents of racism started to emerge under the hashtag #Airbnbwhileblack. One customer who claims he was denied a rental because of his race filed a class-action lawsuit against the company. A federal judge blocked that lawsuit on Wednesday, citing Airbnb’s user agreement, which requires that disputes be settled in private arbitration and bans users from participating in class-action suits.

To be sure, Airbnb didn’t take the threat to its business lightly. It loudly broadcast its intent to root out racism on the site, and introduced a mandatory new anti-discrimination policy this week that demands users treat everyone “with respect, and without judgment or bias” regardless of “race, religion, national origin, ethnicity, disability, sex, gender identity, sexual orientation, or age.” In September, the company announced a full-time anti-bias and diversity team and made changes to its booking process that included promoted instant bookings, where host approval is not necessary, and reducing the prominence of guest photos in favor of promoting objective information from guest profiles.

Despite all that, Grant and Gilkes say their businesses are still viable and necessary.

“We can really fill a niche and void, catering to the black travel experience, while welcoming other cultures and people,” says Grant, 28, who co-founded Noirbnb with business partner Ronnia Cherry. Previously, he ran his own record label that produced music for rap artists, and hosted music events. Grant says he met with Airbnb last year to pitch his website idea. Airbnb did not respond to a request to confirm the meeting.

As with Airbnb, hosts on Noirbnb will have to agree to a non-discrimination policy. But unlike Airbnb, Grant wants the site to highlight people’s differences, visible through photos and profiles.

“You don’t have to hide your skin color and face,” he says. “We want to create a community where people are fully welcome.”

Innclusive will also make users sign a non-discrimination policy, but will be more protective of users’ public profiles. The company will verify customers on the backend, but hosts will only get information that is relevant to a booking, such as host reviews and confirmation that their guests have valid social media accounts. Full guest profiles, including names and photos, will only be viewable after the booking is complete.

“We don’t think what the person looks like is an important decision-making point,” says Gilkes, who employs 18 people at his parent company GrooveLiving, in Tampa, Fla. The company is an umbrella for eight ventures that include business software and consumer apps.

Whether the sites’ precautions and overall message of inclusion are sufficient to drive business is another matter. Howard Buford, founder of cross-cultural marketing strategy company Quorum Consulting for one, is dubious.

“Race does not drive Airbnb’s business, it impacts Airbnb,” he says. “So the same is likely to be true for Innclusive and Noirbnb.”

Innclusive has started taking bookings as a beta site and Noirbnb will launch in December.